2006-11-04 papers

on Public Finance

Issue of 2006‒11‒04
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Progressive Estate Taxation By Emmanuel Farhi; Ivan Werning

By:	Emmanuel Farhi; Ivan Werning
Abstract:	For an economy with altruistic parents facing productivity shocks, the optimal estate taxation is progressive: fortunate parents should face lower net returns on their inheritances. This progressivity reflects optimal mean reversion in consumption, which ensures that a long-run steady state exists with bounded inequality - avoiding immiseration.
JEL:	E6
Date:	2006–10
URL:	http://d.repec.org/n?u=RePEc:nbr:nberwo:12600&r=pub

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